Munjal said that Hero needs to play an active role in the upper segment of the bike market that's dominated by products from other companies Pankaj Doval | TNN | Updated: September 27, 2016, 18:10 IST

Pawan MunjalHero MotoCorp will focus on the premium motorcycle category in new product development and rollout as the company’s in-house product development team works on higher-powered bikes.

Pawan Munjal, chairman of the country’s biggest two-wheeler company, said that there is a need for Hero to play a more active role in the upper segment of the bike market which is currently dominated by products from companies such as Bajaj Auto, Yamaha and Royal Enfield.

“Hero needs to do a lot more in the premium segment,” Munjal said as he launched a new 150cc motorcycle, Achiever, priced at Rs 61,800 (ex-showroom Delhi).

"This is just the beginning of a wide and vast effort in the premium segment ... there is a lot more to come," he said.

The company currently dominates the entry end of the bike market with products such as the Splendor and Passion, but has not been able to make much of a headway in the premium products, which fetch higher profit margins. Its share in the premium segment is in low single-digit percentage point, though the company is now targeting to take this up to double digits.

Apart from the Achiever, Hero’s products in the premium category include Xtreme, Hunk (both 150cc), Karizma and ZMR (both 225 cc). However, the products have not been able to crack success with buyers, prompting the company to look at new products as well as upgrades.

Hero has been trying to build-up its strength in product development through the in-house Centre of Innovation and Technology (CIT) in Jaipur, for which it has hired expats such as Head of Product Planning Malo Le Masson (formerly with premium car brand Infiniti) and Chief Technology Officer Markus Braunsperger (earlier with BMW).

Munjal has said that development of new products and higher-powered bikes is one of the key agenda in front of the company. A 200cc sports version of the Xtreme is under development and is expected for launch in the coming quarters.

The company – which has seen its cumulative production cross 70 million this month -- said that bike sales are expected to bounce back on good monsoon and a possible revival in rural demand. Demand during the ‘onam’ festival in the south has been healthy and volumes moved up 35%.